PPC Advertising VS Non PPC

10 September 2014

When it comes to advertising your product, the Internet has become a great magnet for attracting potential customers. The Internet provides advertisers with the opportunity to target their audience through interests and demographics.

One of the most popular forms of advertising is PPC. So the question is, does PPC advertising offer the best return on investment compared to non PPC?

The simple and predictable answer is – it depends on your business. Therefore learning a little bit about PPC and Non PPC can lead you in the right direction, and guide you to make the right decision that suits you.

PPC Advertising

PPC stands for Pay Per Click, it is also referred to as CPC (cost per click).

With PPC advertising you pay for each click your ad receives. For example if you are spending £1 for each click, then 10 clicks will cost you £10. You will be charged each time someone clicks on your ad or sponsored story. Cost Per Click is also called PPC, Pay-Per-Click.

Advantages

Here are just some of the advantages of PPC advertising;

  • Local to Global Exposure – one of the greatest PPC benefits is being able to choose where your ads are served by location. You can specifically target new geographic and demographic markets.
  • Set your own budget – with PPC advertising you can specify your own budget which allows you more control over your sales goals.
  • Increase depth of keyword targeting – if you have a small website and would like a larger amount of keywords, you will benefit from PPC advertising as it lets you target as many keywords as you like. This is compared to organic searches that will only support keywords which appear on your website
  • Level Playing Field – even if your business is small, you can still compete with your bigger competitors

Disadvantages

Unfortunately there are some downsides to PPC advertising, here they are;

  • The bidding war – someone can bid a higher amount compared to your bid, as a result your search engine position will drop.
  • Click fraud – a big concern for those who are involved in text ads and PPC. Publishers will try to get more money by clicking on ads that are on their own website.
  • Unintended Clicks – it’s possible to loose money from accidental clicks. For example a visitor may click on a link without paying attention to what they are looking at, or by assuming it’s part of the website they’re on.
  • No Guarantees – even though you are paying for PPC advertising, this does not necessarily mean that you will make money from the clicks. Millions of users click on links then leave the page straight away. It’s important to remember that clicks do not always translate into sales.

Who Should Use PPC Advertising?

Whether your business is new, re-designed /re-launched or you just want to get exposure, PPC advertising is a worthwhile option. PPC ads will be displayed with search engine results which will attract customers straight away. Even if you are waiting for natural SEO techniques to kick in, PPC advertising can fill the gap and give you a boost.

CPM Advertising

CPM stands for Cost Per Impression, and this refers to to cost per thousand impressions and is used by the advertising industry to describe how many people have viewed  the banner ad (page views), or received an impression by seeing the ad. You will pay when people see your ad.

Advantages

  • Cost – Impression based campaigns can be very cheap, in a lot of cases you can have your advertisement seen thousands of times for less than £1.
  • Statistics – whilst your ad is running you can monitor the statistics such as CTR (click through rate) and make changes if you need to.
  • Placement – CPM ads can be placed anywhere at all, giving you more freedom.
  • Less Risk – it can be viewed that there is less risk involved as you do not need to rely on people clicking on your ad.

Disadvantages

  • Multiple showings – it is possible that you may show your ad to the same person multiple times, and are charged for it.
  • No Results- even if you have no results, you will be still be charged.
  • Traffic – you will need lots of traffic to make a real impact.
Who Should Use CPM Advertising?

This method is profitable to both publishers and advertisers, but perhaps more for publishers as they will be paid for every thousand page views that the site receives. For the ad owner this method could be extremely profitable or could not really work in your favour. CPM does not have a big role in your advertising ventures unless you are lucky enough to be receiving thousands of visitors a day, if not, then it’s not profitable.

 Flat Price Advertising

Flat Price advertising is where you pay per month for an advert on a website. The advertiser and the publisher will agree upon a fixed amount, this is probably the most common approach used.

Advantages

  • No cost to performance criteria – you pay by week or month and don’t have to worry about clicks or impressions for what you pay.
  • On page advertising – Advertising on page is an effective way to target a niche audience. You have control to see the search engine ranking of the website you would like to advertise on and judge whether that would be a beneficial site to place your ad.
  • Easy to understand – You know exactly what you’re paying, where your ad is and the audience you are targeting.

Disadvantages

  • Not target related – one downside is that you may not be able to track the click through rate as much as with CPM and CPC.
  • Capped  – the revenue is capped, if you happen to have lots of visitors on your site due to your ad, the price is the same.
Who Should Use Flat Price Advertising?

Putting your ad on a well established site is going to give you what you pay for. New websites could be a risky endeavor, so it is important to choose one with a good search engine ranking. You will also get your money’s worth if you deal directly with the site owner. For new businesses that don’t want to take big risks associated with PPC advertising and CPM and keep control of their fees, this could be the right option for you.

PPC Advertising vs PPC – Summary

Again this really depends on what your marketing and advertising strategy is. It is important to have a clear view on this and who your audience is before you decide to use PPC or a non PPC advertising method.

If you would like guidance on choosing the right advertising method or about PPC advertising, why not have a look at our Pay Per Click Management Page.